Colleges are full of it: Behind the three-decade scheme to raise tuition

The parents of international students, primarily from Asia, are also willing to pay for it. The US has recently jumped all out onto this income stream (since 2008), and if you look at how things went in countries that have been doing it much longer, like Australia, you'll realize it'll be quite a while before Asian parents aren't willing and able to pay US college tuition for their children anymore.

But while nobody's publicly saying so, it is true that the (not really) "poor" homeowners are responsible for the 2001 crisis. The cause of the crisis was, after all, that >2% of homeowners (mostly poor ones) stopped paying their loans because (partly it was no longer in their financial interest to do so). Which cause banks to sell CDOs that were valued on the assumption that this would never happen. Which caused some banks to get stung with CDOs.

The great crime of the elite was to offer loans to people bigger than what they could reasonably pay back. Nobody forced anyone to take the money, or hid the fact that it needed to be paid back. Too large a percentage of people just didn't abide by contracts they signed.

And they failed to abide by those contracts for the exact same reason banks try to get out from under obligations : there were losing a little bit of money.

I don't think people are blaming the poor. People are blaming homeowners who overextended themselves, or simply walked away from their loan obligations. And this is justified. They caused the crisis. Yes they were pushed into it. Does that excuse it ? I don't know.

(1) Before 30 years ago or so, a student paid only about 1/3rd of what a college education really cost. The rest was from 'overhead' taken from research grants, gifts, endowment income (from gifts), government funding (say, state universities).

(2) Good students with little or no money got various forms of financial assistance -- scholarships, work-study, etc.

(3) Wealthy students still paid only the 1/3rd.

So, someone got a bright idea: Why should wealthy students pay only 1/3rd instead of 100%? So, why not let the 'list price' to the students be the full cost? Then wealthy students will pay the full cost and others will get 'scholarships' based on need and academic qualifications.

So, the 'list price' went from 1/3rd of the real cost to 100% of the real cost, that is, up by a factor of 3, that is, 300%. The rest of the increases were due to better prof salaries, higher AdFunk salaries and more AdFunks, better facilities, etc.

But if have a really good media 'story', why give an explanation that would end the suspense, interest, drama, sense of scandal, etc. and, thus, end the story? And lose the eyeballs and ad revenue? Gotta be kidding!

Welcome to the country where the major leftist party is actually arguably anti-union. In most areas it's actually quite a bit right-of-center, in economic cases it's extreme right.

If a rightist party in most European states proposed reducing a European national health insurance to the level of the ACA, they'd immediately be cordoned off and laughed out of parliament. They know this, and so it never happens.

I still find it absolutely incredible.

Well, I don't really know. I agree with you that standardized testing is not a good way to do this.

Perhaps a system where anybody can attend but the public tuition stops being paid for them if their GPA falls below some threshold? But then you get the problem of shoddy colleges popping up that accept everybody and give everybody good grades. I think restricting the public tuition to non-profit schools would help solve that problem, in addition to strict caps on salaries of different classes of university employees. As long as people don't see running a shoddy university as a way to make money for themselves, they'll probably stay away from it.